British Gas puts up prices 14%

British Gas has announced it is to increase the price of its Market Tracker energy plan with immediate effect.

Prices will now rise 14 per cent, the company has confirmed.

The plan is designed to track wholesale energy prices on a quarterly basis. It is aimed at a specific type of consumer who does not mind taking a chance on bills going up, as well as down, on a far more frequent basis.

As such consumers now fear prices could rise across the board, following recent increases in global commodity prices.

The British Gas move follows only weeks after Centrica - British Gas's parent company - warned of the pricing pressures all suppliers are coming under and gave a strong hint to consumers that it would have no other option but to increase household energy prices for the second time this year.

This increase is seen as an indication of what consumers can expect.

"The British Gas Market Tracker plan tracks wholesale energy prices so acts like an early warning system, alerting consumers to the pressures suppliers are under and the impact this could have on household energy prices," explained Ann Robinson, director of consumer policy at uSwitch.com.

"The Tracker price increase following so swiftly from Centrica's hint a few weeks ago is a clear sign of things to come and consumers should now be fully prepared for across the board energy price rises.

"We are talking about all suppliers putting up their prices for a second, or even third, time this year. In the worst case scenario this could lead to the average household energy bill hitting £1,327 by the end of the year."

The average dual fuel bill size currently stands at £1,048.

A ten per cent increase will add £105 to make the average bill size £1,153. A further 15 per cent increase will add £173 to make it finally £1,327, possibly by the end of 2008.

Chris O'Toole